Deal Effectively Doubles U.S. Bank’s Deposit Market Share in Region
MINNEAPOLIS--(BUSINESS WIRE)--Jan. 7, 2014--
U.S. Bancorp (NYSE: USB) announced today that its lead bank, U.S. Bank
National Association, has reached an agreement to acquire the Chicago
branch banking operations of the Charter One Bank franchise owned by RBS
Citizens Financial Group. The acquisition includes Charter One’s Chicago
retail branch network, small business operations, and select middle
market relationships. Once complete, the acquisition will nearly double
U.S. Bank’s deposit market share in the Chicago metro area.
Under the terms of this transaction, U.S. Bank will acquire
approximately $5.3 billion of deposits, $1.1 billion of loans, 94
branches, and 800 employees for a deposit premium of approximately $315
million, or 6 percent. At close, U.S. Bank will have combined deposits
of approximately $11.3 billion in Chicago. Approximately 35 percent of
the $5.3 billion of acquired deposits are non-interest bearing and NOW
accounts; 48 percent are money market and savings accounts; and 17
percent are time deposits.
“This transaction will double our market share in Chicago, giving us a
great opportunity to not only deepen existing customer relationships,
but a chance to serve new customers with our extensive mix of products
and services,” said John Elmore, vice chairman of community banking and
branch delivery for U.S. Bank.
Marsha Cruzan, Chicago market president for U.S. Bank, said, “Chicago is
a vibrant and important market for U.S. Bank. We’ve worked hard to grow
our presence here over the past five years and this latest acquisition
strengthens our position as a top bank in the Chicago area.”
This acquisition is expected to meet or exceed U.S. Bancorp’s internal
financial hurdles for internal rate of return and earnings per share
accretion. This transaction is subject to regulatory approval and is
anticipated to close in mid-2014.
RBS Citizens Financial Group Chicago branches will continue to operate
under their current name, Charter One, during the transition, and will
be re-branded as U.S. Bank branches once the transaction is complete.
About U.S. Bancorp
U.S. Bancorp, with $361 billion in assets as of Sept. 30, 2013, is the
parent company of U.S. Bank, the 5th largest commercial bank in the
United States. The company operates 3,088 banking offices in 25 states
and 4,937 ATMs and provides a comprehensive line of banking, brokerage,
insurance, investment, mortgage, trust and payment services products to
consumers, businesses and institutions. Visit U.S. Bancorp on the web at www.usbank.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995: This press release contains forward-looking statements
about U.S. Bancorp. Statements that are not historical or current facts,
including statements about beliefs and expectations, are forward-looking
statements and are based on the information available to, and
assumptions and estimates made by, management as of the date hereof.
These forward-looking statements cover, among other things, anticipated
future revenue and expenses and the future plans and prospects of U.S.
Bancorp. Forward-looking statements involve inherent risks and
uncertainties, and important factors could cause actual results to
differ materially from those anticipated. Global and domestic economies
could fail to recover from the recent economic downturn or could
experience another severe contraction, which could adversely affect U.S.
Bancorp’s revenues and the values of its assets and liabilities. Global
financial markets could experience a recurrence of significant
turbulence, which could reduce the availability of funding to certain
financial institutions and lead to a tightening of credit, a reduction
of business activity, and increased market volatility. Continued stress
in the commercial real estate markets, as well as a delay or failure of
recovery in the residential real estate markets could cause additional
credit losses and deterioration in asset values. In addition,
U.S. Bancorp’s business and financial performance is likely to be
negatively impacted by recently enacted and future legislation and
regulation. U.S. Bancorp’s results could also be adversely affected by
deterioration in general business and economic conditions; changes in
interest rates; deterioration in the credit quality of its loan
portfolios or in the value of the collateral securing those loans;
deterioration in the value of securities held in its investment
securities portfolio; legal and regulatory developments; increased
competition from both banks and non-banks; changes in customer behavior
and preferences; effects of mergers and acquisitions and related
integration; effects of critical accounting policies and judgments; and
management’s ability to effectively manage credit risk, residual value
risk, market risk, operational risk, interest rate risk and liquidity
risk. Finally, there can be no assurance that U.S. Bancorp will realize
the anticipated benefits of the acquisition of the Chicago operations of
the Charter One Bank franchise owned by RBS Citizens, National
Association.
For a discussion of such risks and uncertainties, which could cause
actual results to differ from expectations, see U.S. Bancorp’s Annual
Report on Form 10-K for the year ended December 31, 2012, including the
sections entitled "Risk Factors" and “Corporate Risk Profile” contained
in Exhibit 13, and all subsequent filings with the Securities and
Exchange Commission under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934. However, factors other than these also
could adversely affect U.S. Bancorp’s results, and you should not
consider these factors to be a complete set of all potential risks or
uncertainties. Forward-looking statements speak only as of the date
hereof, and U.S. Bancorp undertakes no obligation to update them in
light of new information or future events.
Source: U.S. Bancorp
U.S. Bancorp
Tom Joyce, Media Relations, 612-303-3167
Judith
T. Murphy, Investor Relations, 612-303-0783